How Much Could Conan O’Brien Make Online?

It’s not clear where Conan O’Brien will end up when he finally departs NBC, but some have suggested he take his act online, where a number of people already watch his antics. Revision3 even issued an open letter to the late-night talk show host, promising him the opportunity to create a brand new show through its network.

But what do web video pros think? To find out, we asked a few if moving Conan from late night to the web would make sense. Some dismissed the idea, saying that the economics wouldn’t work out and that there was no way a web show — even one with a brand like Conan O’Brien at the helm — could possibly make money. But not surprisingly, Jim Louderback, CEO of the company that wrote the open letter to Conan, sees a model where the late-night host could generate significant revenue, if not the same level of revenue, under the broadcast model.

First, let’s look at the money Conan is generating now. Based on the approximate 2 million viewers that show up to watch The Tonight Show on TV, along with the number of ads that are shown, Louderback estimates that NBC pulls in about $200 million a year from Conan’s show.

But what happens if you move Conan online? Let’s say the move cuts his audience in half, resulting in about a million people tuning in. With a couple of pre-roll or mid-roll ads and a bunch of overlays shown on YouTube model, Louderback estimates that the show could pull in around $40 million. A more conservative estimate, with Conan retaining about 500,000 viewers per episode and lower CPMS, puts revenue at between $15 million to $20 million — which definitely isn’t broadcast money, but is still good money when compared to other online productions.

“What are great numbers for an independent show creator are not great numbers for Conan,” said Mike Hudack, CEO of blip.tv. “Some of the best web shows make hundreds of thousands of dollars, but Conan makes about $1 million per episode.”

What might be a bigger problem for getting Conan — or really any network star — to take his show online is the cost of funding production. The Tonight Show employs a massive staff, which Tim Shey, co-founder and executive vice president of Next New Networks, says he’s unlikely to part with. “Conan’s got a whole band, he’s got 30 writers. I can’t wait for the first Conan to come to web television, but Conan wants to get jobs for his whole staff.” Online, Shey said, “you have to do these things lean, do them tight, and do them low-cost.”

It seems unlikely that Conan would make a move online — even if he can afford to do so, having just negotiated $40 million from NBC to leave the network, according to reports. But most believe the day of the network star moving online could come soon, since the audience is already there and the money is following fast.